In the final part of this three-part series on how catalogersโ pricing strategies are evolving in response to the Webโs effect on branded products, this week Iโll look at the economic factors that can affect promotional pricing strategies. (For part 1, click here; for part 2, click here.) While using a promotional pricing strategy can prove effective, there are a number of economic issues you should concern yourself with. Pricing below existing market prices has a number of pitfalls, including the following issues. 1. Can the incremental sales produce enough incremental profit to offset the loss in margin from lower prices? The increase
Merchandising
In the second installment of this three-part series on how catalogersโ pricing strategies are evolving in response to the Webโs effect on branded products, this week Iโll provide options on how to increase sales without cutting prices across all merchandise. (For part 1, click here.) Catalogers often mistakenly assume that cutting prices will increase sales enough to deliver additional profit. Sales can go up, but profits can go down. Even worse, sometimes cutting prices yields no increase in sales; then profits really decline. To successfully achieve a 10 percent-plus sales increase based on cutting prices, you must first test the price sensitivity of
Bounceback programs are often limited to inserting a copy of your most recent catalog โ preferably with a different cover โ into the fulfillment box. But as shipping rates, fuel surcharges and paper costs all increase, more catalogers are opting against this approach. Theyโve run the numbers, and their incremental sales from those catalogs no longer justify the expense. If youโre in this position, or are wondering how to leverage shipping expenses, try a strategically planned and formally managed bounceback program. A bounceback program can help build your brand, improve customer retention and develop a new revenue stream, regardless of whether youโre in B-to-C
In the first installment of this three-part series on how catalogersโ pricing strategies are evolving in response to the Webโs effect on branded products, letโs examine how catalogers have been put in this precarious situation and what they need to do to remain profitable. As the price-comparison engines turn more branded products into commodities, whatโs your catalogโs best pricing strategy? Most catalogersโ current pricing strategy is to have the lowest market price available โ either matching or beating any competitorโs best price. This policy is typically supported with a lowest price guarantee. Itโs becoming common for most catalogers and Web merchants to offer
Itโs amazing how many companies donโt look very closely at software license agreements. These are legal documents, and without close review of payment terms, deliverables, schedules, termination options and other key details, you could be putting your company at risk of losing thousands of dollars. To protect yourself and your companyโs interests, donโt rush into signing an agreement just because the vendor is giving you a soon-to-expire discount. Getting to a fair agreement for both parties takes time, negotiation and a careful review of any contract. (A quick disclaimer: The focus of this article is to alert you of some of the items youโll
Many multichannel merchants turn to private label merchandise to create their own unique identities, niches and brands as exclusive labels continue to increase in popularity among consumers. But has this necessarily been a good thing? According to a recent benchmark report published by research firm Retail Systems Research titled โPLM Squared: Product Lifecycle Management Powers Private Label Merchandise,โ this recent phenomenon has been plagued by quality concerns from consumers. Much of this concern stems from marketersโ increased reliance on sourcing this merchandise from low-cost sourcing countries. The recent survey polled 59 multichannel marketers. Here are some noteworthy findings of the survey. * Last year
Thereโs that old Bob Dylan song about times a-changinโ that I wonโt bother to quote further. But it seems to hold true moreso year after year, and 2008 is no exception. So while some of us continue to exchange โhappy new yearโ greetings with one another, Iโll send along one last new yearโs greeting with what I believe to be the top five actions you should act on, examine or just ponder to bring your catalog/multichannel business in sync with the times. 1. Get your matchback system working smoothly at once. Assign someone in either your marketing or operations departments to do nothing
Over the past few months, we at Catalog Success have been hard at work to further develop a hefty well of research data for our readers. In October we launched the Catalog Success Latest Trends Report, a quarterly series of original benchmarking research weโve been conducting with the multichannel ad agency Ovation Marketing. In the coming months, weโll also be running a series of mail volume charts provided by several catalog co-op databases. Like the Latest Trends surveys, these will run in the IndustryEye section of our print magazine. And for the past year or so, weโve been running a regular reader poll.
In the IndustryEye section of this issue on pgs. 12-13, youโll find our second quarterly Catalog Success Latest Trends Report, a benchmarking survey we conducted in late November in partnership with the multichannel ad agency Ovation Marketing. This one focuses on key catalog/multichannel issues, and weโve included most of the charts there, so I encourage you to take a look. Youโll be able to find some charts only on our Web site due to magazine space limitations. We also didnโt have the space to include the numerous comments that you โ our readers and survey respondents โ wrote in response to two of the questions.
The exterior view portrayed a strong, stable company โ a well-oiled machine churning along toward future profits and continued success. The interior showed an entirely different story โ a company crumbling just like one of its cookies. Mrs. Fieldsโ early success actually led to the downturn of its catalog direct/online unit. With that early success and rapid growth, Mrs. Fields didnโt invest properly in the infrastructure (marketing database, systems, tracking) of the direct division, says Greg Berglund, president of Salt Lake City-based Mrs. Fields Gifts. Whatโs more, the company failed to keep product offerings fresh and relevant, especially the refreshing of photography and item